Cyber Court

This Act creates and regulates an Internet “cyber court” to conduct electronic hearings and proceedings in order to accommodate parties located outside the state in commercial litigation involving more than $25,000. The stated purpose of the cyber court is “to allow disputes between business and commercial entities to be resolved with the speed and efficiency required by the information age economy.” The cyber court will be located in one or more counties as determined by the state supreme court, and will sit in facilities designed to allow all hearings and proceedings to be conducted by means of electronic communications, including, but not limited to, video and audio conferencing and Internet conferencing. Whenever it is technologically feasible, all of the cyber court's proceedings will be broadcast on the Internet. The cyber court’s staff and support services will be maintained at the seat of government, and hold session and schedule hearings or other proceedings to accommodate parties or witnesses who were located outside the state. The state supreme court will assign judges to the cyber court for terms lasting at least three years. The total number of judges assigned to the cyber court will have to reasonably reflect the caseload of the cyber court. In selecting judges for assignment to the cyber court, the supreme court will have to consider a judge's experience in presiding over commercial litigation and their experience and interest in the application of technology to the administration of justice. The state judicial institute will provide appropriate training for judges who are assigned to the cyber court. The cyber court will have concurrent jurisdiction over business and commercial litigation actions in which the amount in controversy exceeded $25,000. An action can be filed in the cyber court by filing a complaint with the clerk of the cyber court, but a defendant could remove the action to circuit court under certain circumstances. The supreme court will adopt special rules for the cyber court regarding practice and procedures, the form and manner of pleadings, and the manner of service of process in the cyber court. All matters heard in the cyber court will be heard by means of electronic communications, including, but not limited to, video and audio conferencing and Internet conferencing among the judge and court personnel, parties, witnesses, and other persons necessary to the proceedings. An action in the cyber court will be heard by the judge without a jury, and unless a party removed an action filed in the cyber court to the circuit court, all parties to an action in the cyber court will be considered to have waived the right totrial by jury and to have waived the right to move for a change of venue. The court could grant a new trial upon the same terms and under the same conditions and for the same reasons as prevail in the case of a circuit court in a case heard by a judge without a jury. The cyber court will have the same power as the circuit court to subpoena witnesses and require the production of books, papers, records, documents, electronic documents, and anyother evidence, and to punish for contempt. The judge and clerk of the cyber court can administer oaths and affirmations and take acknowledgements of instruments by electronic means. An oath or affirmation taken from a person located outside of the state will be considered to be an oath or affirmation authorized by state law. An appeal from the cyber court will be to a special panel of the court of appeals, as prescribed by the state supreme court, and the time within which an appeal as of right could be taken will be governed by supreme court rules. The clerk of the cyber court will have to immediately furnish the parties to every action with an electronic notice of entry of any final order or judgment. The Act directs the supreme court to provide for alternative dispute resolution for matters before the court and creates a legislative oversight committee to monitor the development of the cyber court.

Submitted as: Michigan Public Act 262 of 2001 Status: approved bygovernor, January2002.

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(Title, enacting clause, etc.)

Section 1. [Short Title.] This Act may be cited as “The Cyber Court Act.”

Section 2. [Cyber Court Creation and Purpose.] (1) The cyber court is created and is a court of record. (2) The purpose of the cyber court is to do all of the following: (a) Establish judicial structures that will help to strengthen and revitalize the economy of this state.

(b) Allow disputes between business and commercial entities to be resolved with the expertise, technology, and efficiency required by the information age economy. (c) Assist the judiciary in responding to the rapid expansion of information technology in this state. (d) Establish a technology-rich system to serve the needs of a judicial system operating in a global economy. (e) Maintain the integrity of the judicial system while applying new technologies to judicial proceedings. (f) Supplement other state programs designed to make the state attractive to technologydriven companies. (g) Permit alternative dispute resolution mechanisms to benefit from the technology changes. (h) Establish virtual courtroom facilities, and allow the conducting of court proceedings electronically and the electronic filing of documents. (3) The cyber court shall be located in [one (1)] ormore counties as determined by the supreme court. The cyber court shall sit in facilities designed to allow all hearings and proceedings to be conducted by means of electronic communications, including, but not limited to, video and audio conferencing and Internet conferencing. (4) The cyber court shall hold session and shall schedule hearings or other proceedings to accommodate parties or witnesses who are located outside of this state. A cyber court facility is open to the public to the same extent as a circuit court facility. When technologically feasible, and at the discretion of the judge, pursuant to the court rules, all proceedings of the cyber court shall be broadcast on the Internet. (5) The cyber court shall maintain its staff and support services at the seat of government. (6) The cyber court shall be funded fromannual appropriations to the supreme court.

Section 3. [Assigning Judges to Cyber Court.] (1) The state [supreme court] shall assign to the cyber court persons who have been elected to and served as judges in this state and who have requested to be considered for that assignment. In making assignments to the cyber court, the [supreme court] shall consider a person's experience in presiding over commercial litigation and his or her experience and interest in the application of technology to the administration of justice. The [supreme court] shall endeavor to reflect the ethnic and racial diversity of the state population and the statewide judicial bench when making the assignments under this subsection. (2) The total number of judges assigned to the cyber court shall reasonably reflect the caseload of the cyber court. (3) The duration of a judge’s assignment to the cyber court shall be at least [three (3)] years. (4) The [supreme court] shall appoint the clerk of the cyber court. (5) The [state judicial institute] shall provide appropriate training for judges who are assigned as judges of the cyber court.

Section 4. [Jurisdiction.]

47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 (1) The cyber court has concurrent jurisdiction over business and commercial actions in which the amount in controversy exceeds $25,000.00. (2) For purposes of this section, “business and commercial actions” means disputes arising between business owners, associates, or competitors or between a business entity and its customers. Business and commercial actions include, but are not limited to, the following types of disputes: (a) Those involving information technology, software, or website development, maintenance, or hosting. (b) Those involving the internal organization of business entities and the rights or obligations of shareholders, partners, members, owners, officers, directors, or managers. (c) Those arising out of contractual agreements or other business dealings, including licensing, trade secret, noncompete, nonsolicitation, and confidentiality agreements. (d) Those arising out of commercial transactions, including commercial bank transactions. (e) Those arising out of business or commercial insurance policies. (f) Those involving commercial real propertyother than landlord/tenant disputes. (3) Notwithstanding subsection (2), business and commercial actions expressly exclude the following types of disputes: (a) Tort actions, including, but not limited to, personal injury, wrongful death, or medical malpractice matters. (b) Landlord/tenant matters. (c) Employee/employer disputes. (d) Administrative agency, tax, zoning, and other appeals. (e) Criminal matters. (f) Proceedings to enforce judgments of anytype.

Section 5. [Practices and Procedures.] (1) An action may be filed in the cyber court by filing a complaint with the clerk of the cyber court. (2) Practice and procedure in the cyber court, the form and manner of pleadings, and the manner of service of process shall be in accordance with special rules for the cyber court adopted by the state [supreme court].

Section 6. [Filing Fees.] Before a civil action is filed in the cyber court, the party bringing the action shall pay a filing fee in the amount of [two hundred (200)] dollars. Each month the clerk of the cyber court shall deposit with the [state treasurer] all fees collected, securing and filing a receipt for all the fees deposited.

Section 7. [Removal to Circuit Court.] (1) A defendant in an action filed in the cyber court may remove the action to the [state circuit court] not later than [fourteen (14)] days after the deadline for filing an answer to the complaint. If the action is removed to the [circuit court], the action shall be heard in the [circuit court] in a county in which venue would be proper. (2) If the defendant removes the action to the [circuit court] as provided in subsection (1), the clerk of the cyber court shall forward to the [circuit court], as a filing fee, a portion of the filing fee paid at the commencement of the action in the cyber court that is equal to the filing fee otherwise required in the [circuit court].

Section 8. [Right to Jury Trial.] Unless a party removes an action filed in the cyber court to the [circuit court] pursuant to Section 7 of this Act, all parties to an action in the cyber court shall be considered to have waived the right to trial by jury.

Section 9. [Electronic Communications.] All matters heard in the cyber court shall be heard by means of electronic communications, including, but not limited to, video and audio conferencing and internet

97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 conferencing among the judge and court personnel, parties, witnesses, and other persons necessary to the proceeding.

Section 10. [Powers, Oaths.] The cyber court has the same power to subpoena witnesses and require the production of books, papers, records, documents, electronic documents, and any other evidence and to punish for contempt as the [circuit court] has. The judge and clerk of the cyber court may administer oaths and affirmations and take acknowledgments of instruments by electronic means. An oath or affirmation taken from a person located outside of this state and pursuant to the laws of the jurisdiction in which the person is located shall be considered to be an oath or affirmation authorized by the laws of this state.

Section 11. [Jury.] An action in the cyber court shall be heard by the judge without a jury. The court may grant a new trial upon the same terms and under the same conditions and for the same reasons as prevail in the case of the circuit court of this state, in a case heard by a judge without a jury.

Section 12. [Appeals.] (1) An appeal from the cyber court shall be to the [state court of appeals], as prescribed by [state supreme court] rules. (2) The clerk of the cyber court shall immediately furnish the parties to every action with an electronic notice of entry of any final order or judgment. The time within which an appeal as of right may be taken shall be governed by[supreme court] rules.

Section 13. [Alternative Dispute Resolution.] The [supreme court] shall provide by rule for an alternative dispute resolution for matters before the cyber court.

Section 14. [Reports.] Not later than [insert date], the [state court administrator] shall submit a written report to the [legislature] on the operation of the cyber court. The report shall include the [state court administrator's] recommendations, if any, for expanding the jurisdiction of the cyber court over other matters.

Section 15. [Rules.] The [state supreme court] shall adopt rules to implement this Act.

Section 16. [Legislative Oversight Committee on the Cyber Court.] (1) A legislative oversight committee on the cyber court is created. The committee shall consist of [three (3)] members of the [house of representatives] appointed by the [speaker of the house of representatives], [one (1)] of whom shall not be a member of the majority party, and [three (3)] members of the [senate] appointed by the [majority leader of the senate], [one (1)] of whom shall not be a member of the majority party. Members shall be appointed or removed in the same manner as members of standing committees are appointed or removed in each house. Vacancies shall be filled in the same manner as original appointments. Members of the committee may be reimbursed for expenses incurred in the administration of their duties. (2) Annually the committee shall elect from its membership a chairperson and alternate chairperson, who shall be from different houses, with the first chairperson being from the [house of representatives]. The position of chairperson shall alternate between the [senate] and the [house of representatives]. (3) The business that the committee performs shall be conducted at a public meeting of the committee held in compliance with the state open meetings act, [insert citation]. Public notice of the time, date, and place of the meeting shall be given in the manner required by that Act. (4) Special meetings of the committee shall be held on call of the chairperson or a majority of the committee. The committee shall prescribe rules for its own procedure. A majority of the committee constitutes a quorum. Any recommendation of the committee requires the concurrence of a majority of its membership. As used in this subsection, "majority" means at least [two (2)] of the [three (3)] members appointed by the [speaker of the house] and at least [two (2)] of the [three (3)] members appointed by the [majority leader of the senate].

148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 (5) The committee shall do all of the following for the period beginning [insert date] and ending insert

date]:

(a) Monitor the development of the cyber court. (b) Consider and respond to court rules proposed or adopted by the [supreme court] under Section 15 ofthis Act. (c) In cooperation with the [state court administrative office], determine if further legislation is needed to facilitate the implementation of the cyber court or to expand the jurisdiction of the cyber court. (6) The committee shall report, in writing, to the chairpersons of the standing committees of the senate and the house of representatives having jurisdiction over legislation pertaining to the judiciary, on the topics listed in subsection (5)(a) to (c), and may accompany the report with proposed bills to implement its recommendations.

Section 17. [Severability.] [Insert severability clause.]

Section 18. [Repealer.] [Insert repealer clause.]

Section 19. [Effective Date.] [Insert effective date.]